Amazon Wine is shutting down

Amazon Wine is shutting down at the end of this year, the retailer has just alerted sellers via email. The issue at hand has to do with the existing laws surrounding alcohol sales, which Amazon has unsuccessfully tried to change by working with regulators. The existing laws make it difficult for Amazon to sell alcohol as a retailer and operate a marketplace. That's something that's even more of a conflict now that Amazon owns Whole Foods, which also sells wine, not to mention Amazon's plans to expand its alcohol delivery business through Prime Now and Amazon Fresh.

In the email sent to sellers, the retailer notes that wine will still be offered through Amazon, just not on Amazon Wine:

"Dear valued Seller, as Amazon continues to offer customers additional retail options for buying wine, we will no longer offer a marketplace for wine at this time, and Amazon Wine will close on December 31st, 2017.

Wine will continue to be offered through Amazon Fresh, Prime Now and Whole Foods Markets. Please see our FAQ for further details.

Thank you,

Amazon Wine."

Launched in late 2012, Amazon Wine had represented Amazon's third attempt at entering the online wine sales market.

The company has not said how well Amazon's wine marketplace performed in terms of sales, but dozens of brands have been participating to date.

According to the online FAQ, sellers can continue to fulfill online orders as they would otherwise, but customers will no longer be able to place an order after December 31, 2017, nor browse products on Amazon Wine.

On January 1, 2018, sellers will no longer be able to add or edit products in Seller Central, but will still be able to access their account.

Amazon Wine's customer base will also be notified via email, and a message will display on the Amazon Wine homepage alerting online shoppers to the closing.

The bigger picture here is that Amazon had to choose between its newer focus on alcohol deliveries through Amazon Fresh and its speedier delivery service, Prime Now or its older marketplace, Amazon Wine.

Not surprisingly, Prime Now and Amazon Fresh won.

Today, Amazon Fresh is available in 20 major U.S. metros in addition to London, Berlin and Tokyo. How the existing online grocery delivery service will be combined with Whole Foods' brick-and-mortar has not yet been determined. Still, it's obvious that Amazon's goal is to offer grocery delivery and pickup by leveraging Whole Foods, and that would include alcohol. Perhaps there will even soon come a day when you can simply say, "Alexa, send more beer."

In addition to Amazon Fresh, Amazon's 2-hour delivery service Prime Now has been steadily growing the number of markets offering alcohol delivery, as well. Today, you can order wine and other alcohol in Chicago, Cincinnati, Columbus, Los Angeles and Orange County, Minneapolis, Manhattan, Phoenix, Portland, Sacramento, San Diego, San Francisco Bay Area and Seattle.

This not only competes with fast delivery services like Drizly or the broader Postmates, but also Blue Apron, which offers its own wines.

And Prime Now/Fresh could also tap into the customer base for the soon-to-be shuttered Amazon Wine and rivals, like Wine.com. While those online businesses may still have larger selections, Amazon's ability to send booze more quickly will likely win many customers' dollars.